When Vanda Pharmaceuticals Inc (NASDAQ:VNDA) released its most recent earnings update (31 March 2018), I wanted to understand how these figures stacked up against its past performance. The two benchmarks I used were Vanda Pharmaceuticals’s average earnings over the past couple of years, and its industry performance. These are useful yardsticks to help me gauge whether or not VNDA actually performed well. Below is a quick commentary on how I see VNDA has performed.
Check out our latest analysis for Vanda Pharmaceuticals

How Well Did VNDA Perform?

VNDA is loss-making, with the most recent trailing twelve-month earnings of -US$4.86m (from 31 March 2018), which compared to last year has become
less negative.
Furthermore, the company’s loss seem to be growing over time, with the five-year earnings average of -US$15.33m.
Each year, for the past five years VNDA has seen an annual
increase in operating expense growth, outpacing revenue growth of 30.75%, on average.
This adverse movement is a driver of the company’s inability to reach breakeven.
Inspecting
growth from a sector-level, the
US
biotechs industry has been
growing its average earnings by double-digit 21.75%
in the
previous
year,
and 17.77% over the
past five years.
This means
despite the fact that
Vanda Pharmaceuticals is
presently
loss-making,
it may have
been aided by
industry tailwinds, moving earnings
into a more favorable position.
NasdaqGM:VNDA Income Statement June 19th 18

Although Vanda Pharmaceuticals is loss-making,
it has a sufficient cash cushion (US$248.83m) to pay for its upcoming operating expenses over the next year.
This is a sign of good cash management.

What does this mean?

Though Vanda Pharmaceuticals’s past data is helpful, it is only one aspect of my investment thesis.
Companies that incur net loss is
always
difficult
to forecast
what will happen in the future and when.
The most
insightful
step is to
assess
company-specific issues Vanda Pharmaceuticals may be facing and whether management guidance has
regularly
been met in the past.
I recommend you
continue to research Vanda Pharmaceuticals to get a
more holistic view
of the stock by looking at:

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